Israel Discount Bank and First International Bank of Israel both declared dividend distributions to shareholders Wednesday after reporting strong second-quarter earnings. Discount credited an unusually large windfall from its financial instruments, foreign exchange rate spreads and growth in its credit business. Discount reported net profit of 423 million shekels ($115 million) for the quarter, up 55% from the parallel quarter in 2017. FIBI posted quarterly net profit of 219 million shekels ($59 million), compared with 151 million a year earlier. Excluding one-time items, quarterly net profit was 193 million shekels. FIBI and Discount announced shareholder dividends of 100 million shekels and 42.3 million shekels, respectively. Shares of Discount were trading slightly down around 0.1% in late afternoon trading while FIBI shares were up 0.6%. (Michael Rochvarger and Reuters)

Jet fuel costs leave El Al in the red

A sharp rise in jet fuel prices, the relatively early Passover holiday this year, an accounting change and stiff competition led El Al to a second-quarter loss of $18 million, compared to a $16 million net profit in the parallel 2017 quarter, the Israeli airline reported Wednesday. That brings the carrier’s losses in the first half of the year to $62 million. Only a major turnaround would put El Al in the black for 2018. Revenue rose 1.1%, compared to the parallel quarter, to $547 million. The revenue growth stemmed from a 1.9% rise in the number of passengers, weighted for the number of kilometers the airline flew. Revenue would have grown $12 million, or 2.5%, if not for a new accounting rule that reclassifies how the company reimburses passengers. However, jet fuel expenses soared relative to 2017, further eating up profits. Plus, Passover fell in March, weakening El Al’s Q2 performance relative to Q2 2017. (Yoram Gabison)

Partner misses profit estimates for Q2

Partner Communications, Israel’s second-largest mobile carrier, reported Wednesday a 96% drop in quarterly profit as it continues to invest heavily in the deployment of a fiber optics network and its TV service. Partner earned 2 million shekels ($543,000) in the second quarter, down from 46 million a year earlier. Revenue slipped 1% to 797 million shekels and its mobile subscriber base fell 1% to 2.65 million. According to a Reuters poll of analysts, Partner was forecast to record net profit of 10.25 million shekels on revenue of 800 million shekels. Partner’s revenue and profit have plunged in the wake of a 2012 reform that opened up the mobile market to new players, sharply reducing prices. It is seeking new revenue streams and making a push to become an integrated multiservice telecoms group. Partner shares were up 2% in Wednesday afternoon trading. (Reuters)

TASE closes down on Turkey concerns

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The Tel Aviv Stock Exchange closed in negative territory a sixth consecutive session, as worries about Turkey weighed down markets. The TA-35 ended down 0.7% to 1,564.78, while the broader TA-125 fell 0.6% to 1403.61. Turnover was 1.2 billion shekels ($325 million). The bond market ended up fractionally higher. The Banks-5 index bucked the trend, gaining 0.7%, after First International Bank of Israel reported strong profits that sent its share price up 1.6%. The big winners of the day were Tadiran Holdings, whose share price rose 6.6%, followed by Netto Holdings with a gain of 5.2%. Partner climbed 4.0% despite a report that its quarterly profits had shrunk to 2 million shekels. On the downside, the price of Mazor Robotics plummeted 7.1%, while Electra Consumer dove 5.9% and Audio Codes lost 4.3%. In Forex trading, the dollar inched up 0.1% to 3.693 dollars per shekel, while the euro sank 0.8% to end at 4.181 euros per shekel. (TheMarker)

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